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Your Business

News/Business. A focus on issues facing small business in the United States.

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00:30:00

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Virtual Ch. 787 (MSNBC HD)

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ac3

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TOPIC FREQUENCY

Us 15, Dallas 5, Christy 4, Leffler 4, Stu Taylor 2, Lori 2, L.a. 2, Miami 2, Joann 2, Kyle 1, Rob Inwells 1, Joe Jan Brewer 1, Christy Sterling 1, J.j. Ramberg 1, Ito 1, Mts 1, El Tel 1, An American Express 1, Stu 1, Hastings 1,
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  MSNBC    Your Business    News/Business. A focus on issues  
   facing small business in the United States.  

    February 23, 2013
    2:30 - 3:00am PST  

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you have a great new product and you know people want to buy it. so how do you bring it to market? follow two women as they go through the process of making their business viable and profitable. we'll have that and more coming up next on "your business." hi, there, everybody. i'm j.j. ramberg and welcome to "your business," the show
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dedicated to giving tips and advice to help your small business grow. today's story is for anyone who's had an amazing idea for a new product but has no idea how to bring it to market. we asked the founders of texas-based locker look z to help us out. and they explain explained how they took a clever construction project and turned it into a multi-nation distribution. turning a clever idea into a marketable product can seem as uncertain as the spin of a wheel on a children's board game. but right at the start, these two dallas mother, joe jan brewer and christy sterling, didn't even seem like players. >> this was the first time we ever did this. it was just a completely new adventure for us. it was just berthed out of our own experience with our daughters. >> they were going into the sixth grade, wanted to decorate
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their lock eric there wasn't a lot of cute stuff out there, so christy went to work and came up with some concepts and here we are. >> it was things i glued together in my kitchen at the table. this was the example of a little bin that was basically cardboard paper that i glued together. >> their daughters loved these homemate school decorations and so did their friends. >> on the first day of school, the phones started ridging from other parents saying where did you get that stuff? we want it. we realized there's a market for this. there's nothing out there like this and we should look into this as a business. >> they knew they couldn't do it themselves, and so their first step was to get some help. they met with marketing consultant kyle priest of dallas-based crown partners. >> if you feel you've come up with the next greatest idea and you're not sure what to do, it looks like a mountain to overcome but it's one step at a time. >> i was a little afraid to call
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him. but i called him and he sat down with us. >> we worked more on the tenant s of the business and sat down to create a structure. >> i think sometimes they grab it and forget the human side of things and the reality of how to structure a plan that they can live with. once we had the business plan in place and the brand identity solid it was the time for them to get into the sales mode. >> rob inwells is one of the executives in charge. >> yeah. if you create a product and you want to take it to market, there's several ways, but the age-old way of bringing it to a trade show, showing as many people as you can and finding someone to help you sell it, that's what goes on here ten times a year. >> when we came to the dallas market, we were overwhelmed by how much stuff was here. we were pretty clueless, but one of the -- the advice we did get was try to find a manufacturing rep or a sales rep that can
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distribute your products and that has relationships with relationships. >> as they walked through the trade show, they found a manufacturer's rep listed on the fourth floor. without an appointment and without any referrals, they took their chances and asked to speak to the owner of dallas-based diverse marketing, greg harden. >> they came up to my door, asked to speak with me and had a great idea on this little box they were carrying. i said what'site all about. and christy said i can't tell you what's in the box. he said i don't know how to help you if i don't know what the idea is. we were very fearful at the time about, you know, disclosing any information. and that's when he said have you heard of an nba. we could sign one of those and you could show me your idea. >> the next move for us is we had some initial meetings and we had a retailer come in that we have a good relationship with, hastings out of amarillo and showed it to her and she said i
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think it's just great. i want to do an order. i said, we haven't made it yet and she said i still want to given you an order. she wrote us a nice order. she left and christy and joann, i looked at them, and said, well, i guess we have to make it now. >> with a business plan in place and major retail order in hand, the next step was manufacturing the products. they contacted rray sun. >> we are the bridge between the idea and the product. so if we want to turn the idea to view production in the first stage, you have to give us a design, you have to give us -- >> ray was willing to work with us at that point. not everybody would. some of the factories wanted you to have certain vacuum, business, knowledge established. ray was willing to take us from the start, walk us through, hold
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our handing and say, you guys are new, we can start with small quantity, we can tweak this. >> we had to decide how much of the product we wanted to make. he put together a team to source the product and came back with a product. >> with ray's help the fractries in china were all lined up whoo ill the retailers were waiting for the orders. the next step, the packing, shipping of the merchandise. that's when they got in trouble >> we tried to do it all. unfortunately it was a complete disaster, and they shipped about 80% of our product incorrectly in the first year. so it was a very tough year for us. >> those shipping errors nearly cost them the business, but they got back in the game when they reconnected with another shipper.
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craig clay of maryland-based total fulfillment. >> i don't know what i can tell you. if you don't have a good fulfillment company in place, your customers may not get the right mts. they may not receive it in a timely maerngs if they receive it, it's thrown in a box and it looks damaged to you. >> if we had to do it again, we would look to a shipper that would be accustomed to the type of retail merchandise were selling. >> their products now hang on retail racks advice the country, and the two are ready for their next move. the path from having an idea to getting a product into a store can be a perilous one if you don't know how to navigate it. joining us is laurie ovechkin, founder of book blings.
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ail fred and brad hair soch is the founder and ceo of bhe with a venture capital fund to support early stage companies. good to see you guys. >> good to be here. >> laurie, you heard about these women. >> yes. >> and had an idea and followed their same process, right? >> i did. i did. we had a concept, and then we had to develop a business strategy from there. >> you did the bester er. . you found somebody who did thor er. for you. >> i sure did. >> you said, i have in idea, i know people are going to buy it, what are we going to do now? >> i think lori's idea is the best thing, find a plan that's worked. look at where they have success and trouble and replicate and
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improve upon the processes. as soon as you have a good market you should have a lot of success. >> a great product is not a business and so many people get stuck. they're in love with this great product. even el tel everybody tells them it's great product but scaling it up to wholesalers and retailers, that's a whole different thing. what lori did and what the segment did is how to scale up from a great idea, great product, to distribution, manufacturing, and fulfillment, and unfortunately a lot of people who are passionate about their product get very board and distracted when they have to do that. >> you didn't go to the dallas market, i take it. >> when we had gone to the fall toy preview, i had the privilege of meeting both joann and christy and it was at that point they took me through all of their triem umphs and tribulations. >> do you work with the same people they do? >> we do. >> if someone wants to follow
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the same path but can't work with the same people, how do they know if they're working with the right people? >> i think the key to anything is great business partners. the failure of both businesses is having bad business partner. you have to understand what the key variables are that you want that business partner to deliver. in their case, they needed a business partner that was used to fulfilling products to their retailers. you have to understand what the variables are. >> you want to look at referrals. you want to pick people who have done successfully what you want them to do for you. you know, we don't know what the problem was with the original fulfillment provider, but you want to find somebody that has a proven track record and doing the kinds of things you need them to do. >> actually that's the best-case scenario for lori is to find an adviser or mentor like the two women who have just gone through it who can help her avoid the stumbling blocks and make int
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introducti introductions. >> how do you find it? i talk to people all the time. some woman in the park has great idea. she doesn't have an idea. >> you have to get out there. there was something about we were reluctant to share or idea because we didn't want to get stolen or taken. the truth is you can't get from here to there without going to conferences, without going to the dallas market or toy expo or enterprise conference because the other pieces of the puzzle are held by other people. you have to get the nondisclosure agreement signed but you have to recognize sharing the idea and bringing help to bring it to market is critic critical. >> were you scared to show your idea? >> yes, yes. we were absolutely nervous to do so. but then we also realized that it's important that in order to get this to market, we have to disclose it, we have to build relationships. that's probably one of the biggest lessons we've learned is networking.
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it's amazing how much knowledge you can gain with a person ten minutes at a trade show. they help you feed the challenges you can potentially face, how you can avoid them, best-case scenario. >> when you're first starting out, you don't know the questions to ask and you need to talk to people to find them. congratulations on your product. it looks great. thanks, guys, for the advice on this. we've been talking about what it takes to get your product onto the shelves of major retailers like walgreens and target. not long ago we spoke to representatives from those stores as well as a california business opener who successfully made his way through that process. >> they started out with 16 items in their store and they now have over 50. >> it's just an incredible brand and we're so excited to have them as a partner. >> walgreens and target are so
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happy. they're saying their prospective customers are saying yes to carrots, yes to cucumbers, yes to tomatoes, and yes to blueberries. >> it was productive enough and brought the benchmark. >> ito, leffler, co-founder of san francisco-based yes to said it was a coup. his reaction was something like this. >> i can't say it on television unfortunately. it was oh, beep, beep, beep. it was really incredible. >> early on the 5-year-old company decided to approach large retailers despite its humble beginnings. with a staff of 25 working with five american production facilities, they sold yes to to 25,000 worldwide but getting it
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there was inish lib somewhat of a challenge. >> we had to scramble. we had a rough plan. >> yes to got its first big break after singing plenty of time and money into trade shows. with some help from a contact, yes to got a 30-minute pitch meeting at walgreens that turned into a few hours. >> we wanted that presentation to turn into a presentation that had no question at the end of it. the only question we wanted them to ask was when can we have it. >> answering questions wasn't. leffler said retailers also u want to know about a vendor's potenti potential. >> at the end of the day they're asking are you bringing incremental people to my store and how do you make sure they buy your product versus somebody else's. >> after afternoon online trial and shelf space they needed to ramp up production and fast. that was by far one of the
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trickiest things to do. >> when we first met with target, went through a broker, and that broker adds a certain level of credibility to what you're doing. >> at that point, yes to was better prepared. the kpep had already grown to satisfy increased demand. leffler found some differences among retailers. he learned that each vendor gets its own deal. they're never the same. >> the relationship that you have with your mom is different than what you have with your best friend and it's the same thing here. >> it's important that we have open lines of communications, that we understand what they're expecting from us and in turn that we understand -- or that they understand what we're expecting from them. >> even though a vendor may land a major deal, leffler says they must push to keep partnerships thriving and you have to always think about money. >> if people believe you're getting into 5,800 stores, you get multiorders, that all of a sudden you're made, you're done. unfortunately the first years
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you're putting all the money back in. >> he believes small business owners like him may want to rethink their major league plans until they get their minor league plans in order. >> by starting at smaller retailers, it gives you a significant vaufrmg as you go into these larger retailers to make sure that you do get it right. when we come back, how to draw attention to your business using social media. and we'll talk about the right way to negotiate. i think value, value, value. ♪ let's make a deal we've all had those moments. when you lost the thing you can't believe you lost. when what you just bought, just broke. or when you have a little trouble a long way from home...
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as an american express cardmember you can expect some help. but what you might not expect, is you can get all this with a prepaid card. spends like cash. feels like membership. some of us are born negotiators. some of us aren't. it's imtim dateing. stu taylor is here today. he's going to give us some tips on,000 get the best deal in a negotiation. great to see you, stu. >> it's great to be here, j.j. >> one of the things you talk about is compromise is key. should you go into a negotiation with in the back of your mind saying, okay, this is where i'm
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going to compromise? >> you should go into negotiation, number one is too know what you want to do. you know what the other person wants to do, and you know what you have to do to achieve your goal. so the answer is reaching a resolution to achieve your objective. negotiation is an interesting process, but you know what it is? it has many faces. i used to do professional boxing broadcasting. boxers -- they say fighting is about styles. compromise is about styles. no two negotiations are the same. >> which makes this next idea interesting. you may not know going into a negotiation exactly what's motivating the other side. you may have an idea and it's important to research that, but once you understand that and you can have a discussion about it. perhaps there are compromises you can make that you don't really care about but will make them happy. >> exactly. you just said it. it is value added. every time i go into a negotiation, a i'm thinking what kind of value can i give the
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person on the other side of the table. but you have to understand what it is a person wants. take an example. you're happily married, i assume, and you think how many times does a man not understand the woman or the woman the man because we don't get at the needs. so you have to find what it is the other person wants. it may not be money. some people are in it for ego. some are in it for power. there are different reasons that -- >> but understand their motivations. should you throw out the first price or not? that's the question we get the most. >> that's a great question. i don't mean to be diplomative here but the answer is yes and no. the only time you should throw out the first price is if you're in firm control of the negotiation and the information about the other person and you know where the marks are. if you don't and you come unarmed, then you kind of feel your territory. but there are a couple of ways to do this. there's anchoring. anchoring at the low end. so for example if the home is on
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the market for 500,000 and i want to negotiate a deal. i may risk it. the question is how bad do i want it. i may get thrown out of the negotiation. let's take the opposite side of that. the housing market is red hot. i know that there are going to be people who are going to be bidding over the price, so i'll come in at $550,000 and walk away with a deal so that everybody wins. and the safe way to approach it is in increments. if you're not sure where you're going and you don't want to alienate someone and it's easy to do that, inkre mentally feel your way up the line so you don't turn someone off and build up to the point you want. but going into the negotiation going how bad do i want it and at what price am i going settle. >> got it. then you mentioned this a little bit before, but the value you'll provide. and in some ways the value you'll provide may not cost anything. >> the value you provide, here's the perfect opportunity.
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you can construct any one of a number of scenarios. i may have something that's of no value to me and vice versa. if i have someone who i know is an avid book reader, and this is just extemporaneous, and i happen to own a warehouse full of books, maybe i'll bring eight or ten books and inject it into the conversation, or perhaps if i'm having a difficulty in a conversation, in negotiating an arrangement and they say, you know, i've only got 40 minute, my wife needs to be picked up at the airport, i say, i live right near there, bingo, let me pick up your wife. ite tess value-added perception that will help close a deal. >> people, don't walk away. >> well, if you're unable to reach an agreement, and we've've seen the national hockey league, ridiculous where the egos come into it, power becomesing says.
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we've seen it with the national basketball association and we see it with congress every day. the way to handle the situation is leave on good terms. don't ever leave by alienating someone. you will permanently damage the relationship. you may think, i'd like to do some things for you. why don't we come back in six months and come back and negotiate. >> stu taylor, i appreciate your coming onto the program. thank you. it's likely that competitors are trying to poach your customers, and so it's vital to keep your marketing campaigns fresh. here are five ways to energize sales courtesy of entrepreneur.com. one, establish listening posts. you need to understand your custome customers' needs. use social media, message boards, and blogs. two, announce special promotions. people love a good deal, so use incentives to draw them to your
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company. number three, polish your lead management. ask every new prospect where they heard about your company and may make the leads generated by your online tv trackable. potential customers want to know you're a good corporate citizen. consider a pro bono or help your community. number five, freshen your content. do not let your website become static or boring and make sure each step of your sales process is seamless. it's time now to answer some of your business questions. alfred and brad are with us once again. the first question is about attracting a specific audience online. >> with the social media aspect, we know how to post our product and our offerings with social media, but how do we draw organizations to us through social media? >> it's interesting, right? because social media isn't about
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posting your products and your offerings. he's got it exactly backward. what should he be doing? >> he needs to search out the people he wants to engage with and engage them. posting on social media and posting your information is like going to a cocktail party and handing out fliers and walking out. you want to ask what they're doing, how can you help, share information they can find useful and they'll naturally gravitate to your content. >> i mean i think we've talked bd this before. social media is about an engaging conversation, and that conversation has to be two ways. so you have to seek out the people that you want to engage, and you have to understand what drives their hot buttons and start conversations around that so that they get excited and then they'll reach out to you because they'll start flooling you. >> it's a real earth. we think of social media as free and easy, but actually if it's
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not natural for you to have these conversations, it's time-consuming. create a strategy. >> it's very good about what's good socially. you're most interested in what people show to you. so if you want to generate interest, having genuine interest will get you the attention you want. >> it's just another network like linkedin and facebook. your social media is another way to basically have a different audience and that people who rule on social media are not necessarily the people who rule on tv or other places. so you have to understand it's a different audience and it's a different landscape and you have to find the people that really can move and influence the crowds in that space. >> okay. let's move onto the next one. a question about real estate and when you're ready to expand. >> we're now seeking to expand into other major luxury markets like l.a. and las vegas. what is the key piece your
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experts would give me before i would seek real estate locations to put my news outlet in. >> it's interesting. what does she need to think about? >> i mean we always think the biggest thing is density of population around the area and a population that matches the demographic that you want to sell to. and a lot of people, you know, can't afford to open up on fifth avenue or madison avenue, but there's a lot of great other spots that you can find in major metropolitans areas that have this same type of foot traffic. so, you know, if you open up in midtown new york, that might be great during the day, but there's no nighttime foot traffic. if you open up in soho, you might extend the hours of traffic by three or four hours. >> you really have to understand the neighborhood where you're going. >> you have to find a local broker that understands your business, retail space, and where you might be successful. >> that dovetails exactly with what i wanted to say, which is don't focus on what these
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markets have in common. focus on what makes these markets unique because you're really going to have to tailor your strategy. >> what you need is a very good manager that you can trust. >> who knows. >> in all these places. >> absolutely. >> because your business is changing when you go from having one store here to a store that you can't be at every sing liin day. >> and las vegas is not new york or miami. >> i think that's why having a local manager from that market that understands the cultural nuance differences of dallas, l.a., miami, because there are cultural differences in the way people perceive the market. >> right. but probably someone comes to train with you for a while so they know yours as well. thank you. we appreciate every time you come on the show. want to create dynamic video marketing for your business? then check out our website of